Stubb to be Finland's next PM, backs NATO membership

LAHTI Finland (Reuters) - Finland's EU minister Alexander Stubb, who wants to cut taxes and take his neutral country into NATO, won the leadership of his ruling conservative party on Saturday, putting him on track to become prime minister later this month.

British and U.S.-educated Stubb, 46, a polyglot sportsman, will take over Finland's five-party governing coalition after Prime Minister Jyrki Katainen steps down, possibly as early as next Thursday. Finland holds a general election in April 2015.

"This was a bold and surprising choice. The party has historically won elections with a centre-leaning leader, but now they have clearly picked the most right-leaning candidate," said Mari K Niemi, a researcher at Turku University.

In the vote, Stubb beat two rivals, Jan Vapaavuori and Paula Risikko, both Stubb's colleagues in the current government.

The change at the top of Finland's government is not expected to lead to any immediate policy changes, but Stubb reaffirmed his support for joining NATO in the longer term.

"We have to aim at maximising Finland's national security and being part of decision-making, and that happens best as a NATO member," Stubb told Reuters after delegates at a congress of his National Coalition party elected him as their leader.

"It is absolutely clear that we have to have a comprehensive debate about that," said Stubb, who has stepped up his support for NATO membership since the Ukraine crisis erupted.

Stubb declined to say whether he favoured a referendum on joining NATO. Opinion polls show only one fifth of Finland's 5.5 million people agree with him on the issue. Finland shares a 1,300 km border with Russia, which opposes NATO expansion.

The current government's programme states that Finland will not seek NATO membership during its term but Stubb, who argues that politicians have a responsibility to shape public opinion, says he wants that stance to change during the next parliament.

REVIVING ECONOMY

Stubb, currently minister for foreign trade as well as for European Union affairs, takes over a country whose economy has contracted for two years in a row and may shrink again this year.

He could face his first big test in government negotiations as early as next week because the Social Democrats (SDP), a coalition partner which has also just elected a new leader, have demanded new stimulus measures to boost economic growth and cut unemployment.

"National Coalition took a step to the right, and Stubb is clearly not a stimulus man. This might cause friction in the government negotiations," SDP deputy chairwoman Sanna Marin said in a statement.

The coalition government previously agreed to cut spending and step up economic reforms to curb debt and to protect the euro zone member state's triple-A credit ratings.

Analyst Niemi said expectations were high for both new party leaders, Stubb and the SDP's Antti Rinne, a former union boss.

"The SDP is in a very difficult situation, they have very little room to make more concessions. They might go hard in the negotiations, and if the National Coalition won't take it, they could go into opposition."

Stubb, who holds a doctorate in international relations from the London School of Economics, has said he wants to reduce taxes and state ownership in companies.

He has said he admires economic reforms made over the last decade by Sweden and Germany, which have rebounded more strongly from the global financial crisis than Finland.

The father of two comes from Finland's Swedish-speaking minority and, in addition to Finnish, Swedish and English, also speaks French and German. His wife Suzanne is British.

Stubb is an active user of social media and counts tweeting as well as triathlons and golf among his hobbies.

"He is a politician of the selfie era, a personality. Young people can view him as radical, outspoken, untraditional, trendy, cool and dynamic," said researcher Niemi.

Prime Minister Katainen, 42, is stepping down to seek a high-level EU job.